Quality, Valuation, or Momentum? What is the Gurus betting on?

By Charlie Tian

Guru investors typically focus on concentrated, high-conviction positions that often exhibit key traits like value and quality. Warren Buffett famously emphasized shifting from simply buying cheap stocks to prioritizing quality companies at reasonable prices.

So, what characteristics are the top 25 stocks that these Gurus are currently betting on? Let’s take a closer look.

Examining the data, we found that Gurus are not driven by size, momentum, or traditional valuation ratios—instead, they focus on quality and growth. The top 25 Guru stocks have exhibited significantly higher quality metrics, including profit margins, return on equity, return on invested capital, and moat scores. Additionally, these stocks have demonstrated notably stronger growth rates.

Table 1: Portfolio Valuation

Valuation Ratios	Guru Top 25	S&P 500
PE Ratio¹	29.1	25.2
PEG Ratio²	2.0	1.5
PS Ratio³	5.8	3.3
PB Ratio⁴	5.8	3.2
Price-to-Free-Cash-Flow⁵	31.7	21.3

Date: As of 10/21/2025. Source: GuruFocus.com. Stock quotes are provided by QuoteMedia, Inc. (CSI). Company fundamental data is provided by Morningstar. Analyst estimates data is sourced from both Refinitiv and Morningstar.

Guru Top 25 are the 25 most broadly held stocks in GFGF ETF holdings. The rank is based on the number of gurus who hold the stock. All other things being equal, the stocks that the gurus hold in higher concentrations (percentage of portfolio) are ranked higher. For a list of the current GFGF holdings, visit gfgf – GuruFocus.

Past performance is no guarantee of future results. The referenced index and hypothetical Guru portfolio are shown for general market comparisons, have the benefit of hindsight, and are not meant to represent the Fund. Investors cannot directly invest in an index. Unmanaged index returns do not reflect any fees, expenses or sales charges.

Table 2: Company Size

Parameter	Guru Top 25	S&P 500
# of Stocks	25	500
Total Market Cap in Billions	26,828.58	60,037.08
Average Market Cap in Billions	1,073.14	119.83
Median Market Cap in Billions	233.81	38.37
Of Weight with Market Cap > $10B	98%	100%

Table 3: Quality

Parameter	Guru Top 25	S&P 500
Operating Margin %⁶	30.6	17.5
ROE⁷ %	35.1	15.1
ROIC⁸ %	14.3	7.7
Moat Score (*)	8.2	6.7
Tariff Resilience Score⁹	7.6	7.1

(*) MOAT Score is a proprietary score that measures how much a company has durable business models, which Buffett has famously called “economic castles with unbreachable moats.”

Table 4: Growth

Growth Rates (%)	Guru Top 25	S&P 500
1-Year Revenue	12.4	6.5
1-Year EPS¹⁰	15.9	8.2
3-Year Revenue	10.0	6.8
3-Year EPS	10.3	6.1
Future 3–5Y Total Revenue Growth Rate Estimate	7.8	9.2
Future 3–5Y EPS without NRI Growth Rate Estimate¹¹	11.6	5.0

The above includes discussion about the estimated growth of certain sectors. It is impossible to predict future growth and actual results may vary.

Table 5: Momentum

Parameter	Guru Top 25	S&P 500
3–1 Month Momentum¹² %	1.54	1.86
6–1 Month Momentum %	9.57	13.34
12–1 Month Momentum %	4.47	2.24

In summary, the Gurus are focusing their bets on quality and growth—and that’s precisely the approach we take with the GFGF ETF. Our added quality criteria help us attempt to select companies with potentially higher returns on invested capital and stronger growth rates.

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